Ling Corp.started business at the beginning of 2013.Ling selected the FIFO method for its inventory.In order to maximize its profits for 2013 under this method,prices must be

Question

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Under the FIFO method, the cost of goods sold is based on the cost of the oldest inventory items. If prices are increasing, then the cost of goods sold will be lower because the older inventory items will have a lower cost. This results in a higher gross profit and, therefore, higher profits.

Ling CorpStarted Business at the Beginning of 2013